Rethinking the MBA

PAUL HEMP: As we attempt to assign blame for the current economic crisis, how much can we lay at the feet of business school graduates, MBAs, and the education they’ve received? I’m Paul Hemp, a senior editor at Harvard Business Review. And welcome to Harvard Business IdeaCast.

We have as our guest Henry Mintzberg, a professor of management at McGill University, a prolific author on management issues. He’s actually twice won the Harvard Business Review’s McKinsey Award for the best article of the year. And a long time critic of business school education. Thanks so much for being with us, Henry.

HENRY MINTZBERG: Hi, Paul. It’s a pleasure.

PAUL HEMP: So in a recent article in The Globe and Mail somewhat provocatively titled America’s Monumental Failure of Management, you argued that fundamental weaknesses in graduate management education are a significant cause of the current economic crisis. Now that’s a pretty bold assertion. Flesh out that argument for us a little bit.

HENRY MINTZBERG: Management is not a profession, management is not a science. You can’t learn it the way you learn surgery or engineering. Management is a practice. And you learn management by practicing management. Experience is critically important. You don’t become a manager in a classroom and you certainly don’t become a leader in a classroom. Leadership is earned on the basis of people who choose to follow you. It’s not granted or anointed by some holy water granted in a school.

So when you take people who are too young to have had that experience, they haven’t managed or barely managed, and then you educate them in the belief that they’re becoming managers and leaders, all too often you create hubris from that. You just can’t create a leader in a classroom.

PAUL HEMP: So one of the things you’re suggesting there, though I want to let you returned your critique, is that an MBA degree, especially if it’s from a top tier business school, may give people an unjustified confidence in what they can in fact manage?

HENRY MINTZBERG: Precisely, and then the schools will even claim, as many of them do, that you’re being trained not only for business but for government and the social sector and so on and so forth. And that’s just dead wrong. Management is not something you float around from one place to another. You have to understand the context, you have to understand the industry, you have to understand the organization, you have to understand its culture. You’ve got to get in deep.

And what a lot of this education has done for the people who’ve taken it too seriously is they come in detached from what they are managing. So particularly in very senior positions it’s been very popular to take people through consulting positions like McKinsey and then parachute them straight into senior management. Unless they can overcome it, they’re detached from what they are managing. And that just leads to a disconnected form of managing that’s very dysfunctional and very destructive of the organization.

And the subprime issue is precisely that. The senior management didn’t know or didn’t care. And other people who are not being particularly well-treated didn’t care either.

PAUL HEMP: But let’s return to one of the possible sources of that detachment, management education. Why is management education at fault here?

HENRY MINTZBERG: Because you’re being educated out of context, you’re being educated to manage in general. There’s no such thing as managing in general. There’s managing in a specific situation. So when you take people who are managers and educate them and development them in the context of the practice of managing that’s current for them, you have something very powerful. But when you take people, who even if they’ve been managers like in the MBA programs or something, and you educate them separate from their practice, management in general, you’re not connecting it with the heart and soul of what management is all about. It’s about connecting.

PAUL HEMP: But certainly there are intellectual skills that will be helpful in managing a modern business just as there is, for example, medical knowledge that allows a doctor to practice medicine. Don’t you need to get that foundation of knowledge before entering the fray?

HENRY MINTZBERG: Well, not quite. I was with you until the very last thing you said. Sure, people have to learn knowledge. That’s the kind of science side of managing, if you like. There’s not a lot of science in management, but there is some basic knowledge about economics, about the economy, about human nature. It’s when that becomes the center point of the educational process that you have trouble. Because that’s just a small part of it.

And even that is far better understood by people who have experience. So the business schools are tripping over themselves now creating courses in ethics. You’ve got people who aren’t facing ethical issues debating ethical issues in the classroom. That’s a pretty easy compared to when we have managers in a classroom who are struggling with ethical issues and they raise them in the classroom, then you get really deeply into what it means to make an ethical decision. But to sit in the abstract and talk ethics through a case, which nobody is committed to in any serious way, is just not the same thing.

PAUL HEMP: Let’s just stop there for a second and talk about case studies. Doesn’t the case method, which is a central feature of many MBA programs provide the link with the real world that you are advocating and criticizing business schools for not establishing?

HENRY MINTZBERG: Only superficially. It’s true that you’re being exposed to something that’s happened in the world. But you’ve read 20 pages that’s been written by either a professor or more likely an assistant to professor. And you’ve got 20 pages, you’ve never met a customer, you’ve never used the product, you may never have heard of the company yesterday. But today you’re reading 20 pages and tomorrow you’re being cold called on in a classroom to pronounce on what that company should do.

PAUL HEMP: And that’s not the same thing is actually doing it? It’s not even a close approximation to actually doing it is what you’re saying?

HENRY MINTZBERG: I think it’s a dreadful simulation because the depth of knowledge is so superficial that all the tacit knowledge that goes into a decision, all that deep understanding of an industry, of the people, of the products, none that’s there. You’ve read 20 pages. And after you’ve done that hundreds of times, what kind of a manager does it make you? And I’ll give you a short answer to that. My view of George W. Bush is give me a 20 page case and I’ll give you a war. What did he know about Iraq? And yet his management, so-called, at the White House.

PAUL HEMP: Let me stop on that for one, just go back to the case method for a second. So instead of providing some benefit or some exposure to real world problems, you’re suggesting that it actually does more harm than good by giving a false sense of confidence in one’s ability to deal with situations, is that right?

HENRY MINTZBERG: Precisely. The impression given in an MBA program is that good managers are decisive, so good students take a stand in a case study classroom. Nobody ever accused George W. Bush of not being decisive. He was decisive all right and a lot of it was dreadful. So it’s not a question of being decisive. It’s a question of having an in depth understanding of the things you’re making decisions about.

PAUL HEMP: Let me oppress you on another of your contentions in the article, maybe somewhat more controversial, is that business schools are in some way, maybe I’m misinterpreting here a bit, but are in some way fostering not only short-term thinking and a blinkered or blindered view of the issues they face in the real world, but executive greed.

HENRY MINTZBERG: Yeah, I wouldn’t word it precisely that way. I don’t think the business schools are promoting greed. I think what the business schools are doing are promoting an analytical view of the world, which becomes a numerical view of the world, which reduces very complex issues to rather simple things. So the bottom line is very convenient for people who are steeped in analysis because that gives them something tangible to work with. But the world is nuanced and highly complicated and you don’t want people who are obsessively analytic.

So the business schools are not promoting short-termism. The emphasis on analysis and measurement is promoting short-termism. Keynes said, in the long term we’re all dead. You can’t measure in the long term very easily. So all these performance packages, for example, have to be rather short-term because you’re not going to pay someone for what the company is going to accomplish in eight years from now. And yet if you’re the chief executive, your decisions today may very well determine what’s going to happen in eight years from now, for better or for worse. But nobody is getting paid for that. Everybody is getting paid for short-term results and so you’ve got this crisis with a vengeance.

PAUL HEMP: Let me actually pick up on that thought. Whatever the legitimate criticisms of management education, how big a role did it actually play in the current crisis? You just made the point about short-termism, which in fact is largely driven by investors and analysts focusing on quarterly results. Can we lay the blame for this at the door of business schools?

HENRY MINTZBERG: In part yes, absolutely. Not all. But it’s a syndrome that combines all sorts of things. Economic dogma has been a big part of this. So there’s all sorts of factors. But the business schools are complicit in this whole situation. One blog response to my article in The Globe and Mail was to say that case study method was institute at Harvard in the ’20s, surely I can’t attribute the Great Depression to the Harvard case study method. Well how many Harvard graduates were there in 1929, how many Harvard MBA graduates? The US is graduating 150,000 MBAs a year, the US alone. Just think of the impact of that on the practice of management, it’s huge.

PAUL HEMP: I know you’ve thought a little bit about some alternatives. You’re not the only one calling for a rethink of business education. We at Harvard Business Review run a number of articles and have a number coming up that are thinking about just that. But you’ve been a longtime critic of it and have suggested some alternatives. Can you just briefly lay out what your vision for an alternative way to educate business managers might be?

HENRY MINTZBERG: Yeah, we’ve been working on this for about 15 years in a series of programs. And where I differ from a lot of the other people who are suggesting changes is you cannot fix the conventional MBA, period. You can’t train young people to be managers. So the starting point is nobody should get into any MBA program until they are in management positions and have decent proper experience. And then you don’t build those programs around a bunch of analytical techniques, although you obviously use those too, they’re useful. But you build the program primarily around them learning from their own experience.

They are all on my website, mintzberg.org, but we’ve created an IMPM, an International Masters for Practicing Management in Business, a health care equivalent, IMHL, Health Leadership Program. These are people who average 35, 40, 45, 50 years old. And they sit at round tables and they share their experience. And then somebody who got wind of this created something called www.coachingourselves.com, where we enable people at their own workplace to download materials and train themselves as groups of managers. But it’s all the same. They learn from their own experience by sharing it and reflecting on it.

PAUL HEMP: But those in a way are kind of like executive education, mid-career executive education programs, which have become increasingly popular. But you’re suggesting that we should scupper, essentially, the beginning of career or near beginning of career foundation laying of a conventional MBA?

HENRY MINTZBERG: Close them all down, period.

PAUL HEMP: And send people out into the workforce?

HENRY MINTZBERG: Let them earn their management stripes and then bring them into the classroom or have them do coaching themselves.

PAUL HEMP: Henry Mintzeberg, thanks so much for taking the time to chat today and for contributing your thoughts to what undoubtedly is going to be an important debate over the next months and years.

HENRY MINTZBERG: I appreciate your asking me, Paul. Thank you.

PAUL HEMP: For more discussion about the future of management education, go to hbr.org. Thanks for listening.